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Housing Expert Forum: Shared Equity Housing Models

Welcome to the BPC Housing Commission expert forum! This forum is intended to foster interactive and substantive discussion about pressing housing issues. Each month contributors from different parts of the housing sector will be invited to respond to a discussion topic.

Guest posts are shared regularly with Housing Commissioners to help inform their work.

Have a pressing question you’d like us to consider? Please leave it in the comments section. We encourage you and our expert bloggers to add comments, contributing to the national dialogue on solutions for the future of the housing sector.

Expert bloggers are not members of the BPC Housing Commission. Any views expressed on this forum do not necessarily represent the views of the Housing Commission, its Co-Chairs, or the Bipartisan Policy Center.

QUESTION: How have shared equity housing models created positive impacts on the supply of affordable housing?

Shared Equity Homeownership is a Stepping Stone
By Emily Higgins

Shared equity homeownership provides sustainable and affordable housing that really works for families of modest means, while also delivering a dramatic return on a relatively small public investment. This model creates a stock of permanently affordable, owner-occupied homes that balance private wealth-building with community benefits.

Read the full post here.

Positive Impacts on the Supply of Affordable Housing
By Robert Burns

Shared equity housing models have created positive impacts on the supply of affordable housing, especially for low-income homebuyers. One of the positive impacts includes a decreased risk of foreclosure rates. There is solid evidence supporting the sustainability of homeownership for low-income homebuyers for at least five years.

Read the full post here.

Three Positive Impacts
By Michael Bodaken & Andy Slettebak

Shared equity structures leverage three primary positive impacts: The preservation of affordability, the retention of government support and the building of household balance sheets.

Read the full post here.

Shared Equity Housing Models Stabilize Neighborhoods
By Peter James Elkowitz

In short, shared equity housing models have created significant positive impacts on the supply of affordable housing while stabilizing neighborhoods. The purchaser shares in the rights and responsibilities of homeownership while recognizing many of the benefits of homeownership.

Read the full post here.

Nowhere Near As Much As They Should
By David A. Smith

Like the possibly apocryphal patent clerk who in 1905 quit his job ‘because everything had already been invented,’ over the last three decades we who work in American affordable housing have largely stopped inventing tenure forms, ownership models, occupancy agreements, and physical configurations or layouts – this despite rapid fission of the nuclear family into many more acceptable household types.

Read the full post here.

Shared Equity for Rural Homebuyers
By Mike Feinberg

When thinking of shared equity in housing, rural areas may not be the first to come to mind. But the U.S. Department of Agriculture’s (USDA’s) Section 502 direct loan product is one model of shared equity housing.

Read the full post here.

Shared Equity Models Fill A Vital Place in the Housing Continuum
By Jeff Lubell

Shared equity models fill a vital place in the housing continuum between rental housing and traditional homeownership. Shared equity homeowners receive most of the benefits of traditional homeownership, including: security of tenure (no one can force you out so long as you pay your mortgage on time), ability to modify the home to fit your needs, increased affordability over time (due to fixed mortgage costs) and the ability to build wealth through the forced savings and high leverage of a 30-year fixed rate mortgage.

Read the full post here.

Shared Equity Single Family Mortgages Can Preserve the Long Term Affordability of Homes
By Conrad Egan

Shared equity single family mortgages can assist lower income home buyers and preserve the long term affordability of the homes. They can also assist challenged home owners to exit successfully.

Read the full post here.

Advancing the Supply of Affordable Housing
By Emily Thaden

Shared equity homeownership models — including community land trusts, inclusionary housing or deed-restricted programs designed for lasting affordability, limited equity housing cooperatives, and shared appreciation loan programs that increase and reinvest second loans on the same properties— arguably advance the supply of affordable housing better than commonly used affordable housing models or programs.

Read the full post here.

A Faint Positive Move of the Needle at Most
By Kent Watkins

To the extent that shared equity and other alternate forms of homeownership have been utilized, a faint positive move of the needle at most has occurred. Scale is still lacking and why is an important policy issue. The various shared equity models and others such as rent-to-own have been tried through and around HUD (HOPE VI, FSS, Moving to Work, HOME, 5H) and in States and local programs (ARCH Seattle; community land trusts; deed-restricted houses and condominiums that I have visited in Boulder, CO) for many years, especially in order to help public housing and other low-income populations have this choice.

Read the full post here.

Shared Equity Models Create Housing for Hard-Working Americans
By Jonathan T.M. Reckford

In the words of American writer Guy Finley, “Any burden shared isn’t just half the burden — but a burden made lighter for all who agree to carry it; the unthinkable truth is that if everyone agreed to carry just a little more, everyone would carry a little less.” By sharing both the burdens and benefits with homeowners, shared equity models create housing units for hard-working Americans who lack the income, credit or assets to qualify for conventional mortgages.

Read the full post here.

Increasing Affordable Housing Opportunities in Rural and Urban Markets
By Marcea Hosay Barringer

With S&P/Case-Shiller reporting home prices up 10.3% from a year ago, Freddie Mac predicting home prices will rise 5% in 2014, and affordable rental units available for only one out of every four families who needs them, it’s clear that there are not enough affordable homes in the US.

Read the full post here.

Past Forums

February 2014: What are the most promising opportunities to promote greater residential energy efficiency? Is there a role for the federal government?

December 2013: What opportunities and challenges will immigration reform pose for future housing demand, housing markets, and/or economic revitalization?

October 2013: This month marks the 27th anniversary of the federal Low Income Housing Tax Credit (LIHTC) program. Throughout the program’s tenure, what lessons have we learned? What key components continue to make it a successful program?

July 2013: Who are unconventional stakeholders who can help rally support for housing?

May 2013: What should the federal government’s role be in helping prepare consumers to make financial decisions?

April 2013: Which of the recommendations in the BPC Housing Commission’s report should receive highest priority?

November 2012: What have we learned from past disaster recovery efforts that could be applied in the way of housing assistance following Hurricane Sandy?

October 2012: What should be the interaction (if any) between state and local policies that impact housing availability and affordability?

September 2012: What statement(s) related to housing—policy, or otherwise—would you want to hear in the presidential debates?

August 2012: What is the role of housing education and counseling in the future housing economy and finance system?

July 2012: Do alternative forms of homeownership, such as shared equity models and rent-to-own programs, present viable alternatives for future homeownership?

June 2012: What are the best options for the millions of single-family homes that may be left behind by Baby Boomers as they age, many of which are in suburban or exurban communities?

May 2012: What can we learn from current or previous efforts to link evidence-based outcomes to policy or program development?

April 2012: What lessons can the U.S. learn from housing programs, policies, or regulatory frameworks in other countries?

March 2012: How can housing policy be responsive to today’s urgent needs and simultaneously address long-term trends?

February 2012: What are some of the key characteristics of a healthy housing system? And how can the success of these features be measured?

January 2012: What should the federal government do to address the inventory of foreclosed properties?

December 2011: What are the most pressing issues in housing policy today?

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